Now, cover for dental care

Medical policies that cover outpatient department are quite expensive. Buy them only if you intend to use the facilities.

Increasingly, more and more insurance companies are offering covers for medical treatments that do not require hospitalisation (outpatient department, or OPD).

ICICI Lombard General Insurance and Bajaj Allianz General Insurance were the first ones to launch such products, offering their Health Advantage Plus and Tax Gain Plan, respectively. Apollo Munich Health Insurance is the latest to launch such a product, called Maxima.

“Of the total medical expenditure, a family typically spends over 60 per cent in non-hospitalisation expenses, or OPD,” said Sanjay Datta, head of health insurance at ICICI Lombard. He said the product would help avert big diseases as regular check-ups would ensure that illnesses were controlled in time.

All the companies have loaded their policies with a host of features other than OPD. For example, Health Advantage and Maxima pay for maternity expenses. This includes visits to doctors for tests. These also pay for claims arising out of dental treatments.

However, industry experts and financial planners said these policies were helpful but not a replacement to the regular policies that gave higher coverage at low premiums.

The premium for ICICI Lombard’s Health Advantage Plus is a flat Rs 15,000 yearly until the age of 60 for sums of both Rs 2 lakh and Rs 3 lakh. After that, the yearly premium is Rs 20,000. However, the OPD benefit differs according to age and sum insured. For someone between 36 and 45 years, the maximum claim under OPD can be up to Rs 8,500 and 8,000 for sum insured of Rs 2 lakh and Rs 3 lakh, respectively. The premium in the regular health insurance plan for someone aged 35 and looking for a sum insured of Rs 2 lakh is Rs 2,777 a year. Someone aged 55 has to pay Rs 6,193 for a cover of Rs 2 lakh.

“These plans do give additional facilities like daily cash and reimbursement for dental treatment. So, they definitely has some merit. Go for it only if you have surplus cash,” said Kartik Jhaveri, a certified financial planner.

Another financial planner said though people took such expensive covers, they rarely sent the bills to insurance companies for claims. “It is good to cover incidental costs but mostly it is seen that such policyholders do not have the discipline to file claims on a regular basis,” said Anil Rego, a certified financial planner.

An insurance broker said insurance companies had combined individual plans such as hospital cash to make it a comprehensive cover. The premiums increase with the benefits. “Young professionals who do last-minute tax planning opt for such plans as premiums are high and they get tax benefit under Section 80D,” he said.

He said these policies came with caveats and fine print that a person should understand before buying. For example, Apollo Munich Health Insurance’s Maxima has sub-limits for various expenses. The policy will insure a person only up to three consultations with general practitioners, physicians, gynaecologists and paediatricians. The reimbursement for diagnostic tests and spectacles is restricted to Rs 1,000 within the company’s network hospitals.

All insurance companies settle OPD claims for specified diseases and procedures. Bajaj Allianz’s Tax Gain Plan specifies it will cover only 130 day-care procedures subject to conditions. For instance, treatment for visual problems is covered but the cost of spectacles will be met only if the policy is in the second year, subject to a limit of 25 per cent of the OPD cost.